Commentary: Automakers’ innovation kick spurs engineering jobs

JohnShinal

Is it a poster child of urban blight that lost one-quarter of its population during the last decade? A place where the unemployment rate has surpassed the national average for years?

Or is it a hot market for tech workers, where engineers have plenty of job opportunities and are making surprisingly fat salaries?

It’s all of these things. And Detroit’s split personality tells the story, in microcosm, of the U.S. job market right now. With apologies to Charles Dickens (who knew a thing or two about gritty industrial towns), it’s a tale of two economies.

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One the one hand, you have the broad U.S. job market, which has ranged from weak to apocalyptic for more than two years, and has only recently shown a few vital signs of life.

On the other hand, you’ve got an economy where technology workers — including software developers of all stripes and experience levels — are receiving multiple job offers and lucrative salaries.

Even in Detroit.

A couple weeks back I spoke with Vimal Shyamji, a recruiter with the staffing and consulting firm Winter Wyman, who helps employers find teams of software developers. Shyamji was recently asked by a large marketing agency to find a team of mobile-software developers in Detroit, an assignment that at first blush seemed like a tough one.

But not so.

“I was amazed. Guys in Detroit are getting multiple offers,” said Shyamji, who’s been recruiting tech workers for 13 years.

Multiple offers usually equate to higher salaries, and the same thing is happening now in Detroit, according to Shyamji, who said the mobile developers he placed there are paid just 15% less than what their counterparts make in New York.

Given the cost-of-living-allowance differential between the two cities, that’s another way of saying that software developers are doing better in Detroit (at least financially) than they are in the Big Apple.

According to the latest cost-of-living comparison from bankrate.com, workers in New York making $100,000 a year would only need to earn $45,900 in Detroit to maintain their standard of living. Yet the developers Shyamji placed there are earning almost twice that.

The new auto industry

It’s not just software coders who are in demand. Detroit’s automakers are beating the bushes to fill thousands of engineering roles they need for their new push into electric cars. Ford
F, -0.23%
and General Motors
GM, +0.33%
both have announced plans to hire thousands of engineers this year as they research and build the next generation of cars and fuel cells.

I must confess to being a fan of Detroit, even though I’ve never been to the city. Any town that can provide the music world with Motown, Bob Seger and Ted Nugent has got some guts.

So I was glad to see in the latest metropolitan employment report from the U.S. Bureau of Labor Statistics. It showed that Detroit’s job market has, by one measure, performed better than that of any other large U.S. city during the past year. The unemployment rate in the Detroit metro area dropped to 11.7% in January, from 15.6 % in January 2010.

Granted, the large decline in joblessness wasn’t due only to job creation. Detroit has also suffered a huge drop in population — 25% — between 2000 and 2010, according to the latest U.S. Census figures released earlier this week.

But this column is about the present, not the past, and you don’t have to be a fan of Detroit to feel good about what’s happening there. You just have to be an optimist.

That’s because Detroit just might be the most dramatic example of how tech employment might help lead the U.S. job market out of its two years of funk. Few things (other than government spending) create jobs as quickly as technological innovation, and one of Detroit’s biggest industries is investing millions of dollars to catch up to Japanese car makers in electric car technology.

It’s way too early in the game to call Detroit’s job turnaround a renaissance, of course. But if more industrial cities can attract young, growing tech companies, or have existing industries invest in new technology, as Detroit has, we may in a few years look back on the city as a model for how a former Rust Belt town can claw its way back.

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